Roslyn Layton: With Supreme Court Clarity, It’s Time for Congress to Modernize the USF

The Supreme Court's 6-3 decision this week in FCC v. Consumers’ Research delivered a resounding affirmation of the Universal Service Fund (USF), preserving a critical pillar of American communications policy. With the program’s constitutionality upheld, the focus shifts to Congress to do what only it can—reform the fund for the broadband age and a $5 trillion digital economy.

The $9 billion-per-year USF supports broadband and telecommunications access in rural and low-income communities, for low-income families, as well as in schools, libraries, and healthcare facilities. Though the Court rejected arguments that the program’s structure violates the nondelegation doctrine, its decision underscores that real reform must come through legislative, not judicial, channels.

Lawmakers in both houses of Congress and on both sides of the aisle agree. In a joint statement, House Energy and Commerce Subcommittee Chairs Brett Guthrie, R-Ky., and Richard Hudson, R-N.C., said, “The Committee on Energy and Commerce can now turn its attention to reforming the USF so it can continue to provide every American with access to the connectivity they need to participate in the 21st century economy.”

Senators Ben Ray Luján, D-N.M., and Deb Fischer, R-Neb., co-leaders of the Senate’s bipartisan USF Working Group, echoed that sentiment: “We’re encouraged by the Supreme Court’s ruling on the Universal Service Fund, and we look forward to working together to focus on long-term solutions for the USF, evaluate broadband programs, and help connect unserved and underserved communities across America.”

One of the most promising solutions on the table is to broaden the base of contributors to include modern enterprises that derive economic value from universal connectivity—such as digital advertising, cloud computing, and software as a service platforms. By aligning contributions with today’s internet economy, Congress can significantly reduce the burden on traditional telecom consumers. This modernization would allow the contribution factor—currently over 30% on some voice services—to fall to single digit and even declining levels. Lowering and stabilizing the rate will provide direct relief to consumers while ensuring the fund’s long-term viability.

The Court's ruling thus clears the way for a renewed congressional push to modernize the USF’s funding mechanism, which remains overly reliant on dwindling voice service revenues. Bipartisan and bicameral efforts are already in motion. The bipartisan Senate bill Lowering Broadband Costs for Consumers Act of 2025  and the House version (H.R. 4032)  proposed reform would direct the FCC to expand USF contribution base to include both broadband and qualifying edge providers, ensuring contributions are equitable and nondiscriminatory.

Only edge providers with more than 3% of U.S. broadband data traffic and over $5 billion in annual revenue would be subject to assessment. The FCC would also be tasked with creating a new mechanism under the existing high-cost program to offer targeted, sufficient support for broadband providers’ unrecovered expenses. Importantly, the FCC’s authority over edge and broadband providers would be limited strictly to the collection of USF contributions.

This legislative momentum has found strong support within the FCC as well. FCC Chairman  Brendan Carr welcomed the decision as “an opportunity to turn the FCC’s focus towards the types of reforms necessary to ensure that all Americans have a fair shot at next-generation connectivity.” Commissioner Anna Gomez reminded that “only Congress has the authority to reform the Universal Service Fund in a durable, forward-looking way that can withstand future legal challenges.”

New commissioner Olivia Trusty added, “I look forward to working with my colleagues and Congress on thoughtful reforms… to close the digital divide.”

These calls for legislative action also provide reassurance to limited-government advocates who raised concerns about administrative overreach. Proper congressional oversight, transparent funding mechanisms, and clearly delineated authority are not just good governance—they are necessary to secure the legal and political durability of the USF in a post-Consumers’ Research world.

The stakes are high. Without structural reform, the USF risks both financial instability and eroding public confidence. Reform isn’t just a policy priority; it’s a democratic imperative.

The good news is that bipartisan consensus already exists. With a bicameral working group in place, a pending bills on the table, and FCC commissioners eager to collaborate, the Supreme Court’s decision has opened a political window that Congress should not waste. Let’s seize this opportunity to build a Universal Service Fund that is both economically sustainable and legally resilient—anchored in modern realities and guided by democratic oversight.

Roslyn Layton, PhD, Senior Vice President of Strand Consult and Visiting Researcher at Aalborg University Copenhagen, is an international technology expert focused on the economics, security, and geopolitics of broadband internet technology. She has testified before the U.S. Congress on competition in wireless technologies, spectrum reform, the security advantages of 5G versus Wi-Fi, and the empirical and ethical case for fair cost recovery for broadband networks. She is also a senior contributor to Forbes, a Fellow of the National Security Institute at George Mason University, and a Senior Advisor to the Lincoln Policy Network. This Expert Opinion is exclusive to Broadband Breakfast.

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